THE Glazer family could take out more than £600m from Manchester United's revenues over the next seven years in dividends, interest payments and fees arising from the club's bond issue.
Analysis of the £500m bond prospectus distributed to investors reveals that in addition to annual interest payments of more than £45m the Glazers can take a guaranteed £160m in dividends, one-off payments and fees out of the club.
The terms of the bond also allow the family to take additional annual eight-figure dividends based on a complex formula relating to the ratio of income to interest. Applied to last year's figures, which saw net income of £41.6m, the Glazers could have claimed a dividend of almost £21m.
The device allows the Glazers to take a dividend equal to 50pc of net cash profits, as long as gross profits are more than double the interest paid figure. If, as the Glazers forecast in the prospectus, income continues to grow at Old Trafford, over the seven-year life of the bond the total dividend could reach more than £140m. This comes on top of about £260m in interest payments already paid since the Glazers bought the club in 2005, and a further £23m already taken in fees and personal loans to the six children of Malcolm Glazer who sit on the club board.
The massive cost to United's bottom line of the Glazer's heavily leveraged acquisition confirms the fears of supporters who maintain that the bond issue allows them to take money out of the club and shore up their position. The details are contained in the 320-page prospectus that outlines the "covenants" and "permitted transactions" governing the bond.
Annual interest on the £500m bond, expected to be about 9pc, will cost United £45m a year, or £315m over the term of the bond. This figure could be increased, however, by potential dividends and fees to United's parent companies, controlled by the Glazers.
As well as an immediate payment of £70m, the Glazers can take a dividend of £25m at any time during the life of the bond. The prospectus also reveals that the Glazers can pay to United's parent companies up to £3m a year in "general corporate expenses".
These include "payments in respect of services provided by directors, officers or employees of any such parent entity". These payments are understood to come on top of £6m a year that Glazer-controlled consultancy companies expect to charge United for "administration and management" services over the life of the bond.
Supporters opposed to the Glazers are ramping up lobbying efforts, with protests expected at tonight's Carling Cup semi-final first-leg against Manchester City at Eastlands.